Government scraps existing iwi agreements as RMA reform enters final stages

The Government has decided that existing agreements between councils and local iwi will be scrapped under its new resource management reforms.

The deals, called Mana Whakahono ā Rohe, are between an iwi and a council and set out how iwi will feed into local decision-making. The Government’s resource management reforms would originally have grandfathered these deals into the new system.

Instead, as a result of a flurry of new deals being inked or negotiated and a fierce campaign by the Taxpayers’ Union and Federated Farmers against the deals, the Government has decided that Mana Whakahono ā Rohe agreements will not transfer into the new system.

RMA Reform Minister Chris Bishop said councils will “have the option of entering into new narrowly scoped iwi participation agreements to record how iwi authorities will participate in statutory planning processes and processes required to give effect to Treaty settlement redress”.

“Clear guardrails will be included in the legislation to prevent scope creep,” he said.

Bishop said that since the Resource Management Act (RMA) replacement laws were introduced, the Government had become “concerned about the rapid increase in new agreements and initiated processes between councils and iwi”.

He said just eight agreements existed when his RMA replacement bills were introduced at the end of last year.

“Since then, several dozen more have been agreed or initiated,” Bishop said.

The Ministry for the Environment lists 14 such deals have begun negotiation since the start of this year. More than twenty are in negotiation in total.

Bishop announced Cabinet had agreed to axe the agreements as he and Prime Minister Christopher Luxon set out the next steps in the Government’s RMA reform programme, which involves getting the bills passed through their final stages.

With only a few weeks of Parliamentary sitting time left, there had been some doubt the bills would make it through their remaining stages before the end of the Parliament. Bishop, however, said the House will pass the bills.

National campaigned on overhauling Labour’s resource management regime, which involved scrapping the RMA and replacing it with two new laws. Bishop alighted on a regime that is both very similar and very different to Labour’s reforms.

It also involves scrapping the RMA and replacing it with two new laws, the Planning Bill and the Natural Environment Bill.

The bills have both returned from the select committee process and the Government announced on Monday how it would respond to concerns raised by the select committee. Parliament’s Environment Committee published its reports on the law, totalling more than 1500 pages, although some of the content is the same.

Bishop said the benefits of the new planning system would “boost GDP [gross domestic product] by an additional 0.56% every year by 2050, worth up to $3.1 billion annually”.

“A cost benefit analysis estimates $13.3 billion in savings over 30 years through reduced administrative and compliance costs,” he said.

“Officials also estimate that around 45% of consent and permit applications required under the RMA could be removed under the new system. Based on 2023/24 volumes, that represents between 15,000 and 22,000 consents no longer needed,” Bishop said.

Implementation delayed

Bishop said there were a range of “practical improvements” recommended by the committee, which have been agreed to.

The transition to the new system will take place over 39 months, rather than 30.

“This will provide more time to prepare the first tranche of national instruments and support a smoother transition from the Resource Management Act to the new system,” Bishop said.

Parliamentary Under-Secretary Simon Court, who is supporting Bishop with the reforms, said the committee had recommended the restoration of controlled activity classes to give farmers and other primary producers more certainty, and “simplify wildlife approvals to cut unnecessary bureaucracy so projects can get underway sooner”.

“They have also made it clearer that environmental limits need to balance environmental, social and economic outcomes and that those limits should be workable in practice,” Court said.

The changes made under the last Government to ensure resource management law had an eye to emissions reduction when making planning decisions.

The Government has axed these from the new regime, arguing the Climate Change Response Act and the Emissions Trading Scheme were the appropriate levers for emissions reduction.

Labour leader Chris Hipkins said Labour would not repeal the bills. Photo / Mark Mitchell

Bishop said the next step of the reforms will be the illustrative draft of the new National Policy Direction, a set of national-level directions that guide the use of the new system.

“These reforms will replace one of New Zealand’s most complicated and litigious pieces of legislation with a planning system that is more predictable, more consistent and far better at enabling New Zealand to grow,” he said.

More things are ‘infrastructure’

The Committee has proposed widening the definition of infrastructure in the bill. As originally drafted some “significant infrastructure” gets an easier ride through the new regime. This infrastructure is allowed to breach environmental limits in a way other projects would not.

This is to allow more affordable development of significant infrastructure.

The Committee proposed widening these provisions to “allow other publicly beneficial activities to breach environmental limits in specific circumstances”.

This would mean far more activities classed as “infrastructure” will get a consent if they meet the test of being “publicly beneficial”.

The Committee proposed giving more power ministers that create “national standards that authorise activities or resource use that breach environmental limits where criteria are met”.

Allocation kicked to touch

The reforms had originally included a new regime for the allocation of resources, which would have seen them allocated on a more commercial basis, meaning the bidder willing to pay the highest price would usually be able to use the resource.

Currently, resources are allocated on a “first-in, first-served” basis.

The proposal generated some controversy after it was announced as it touched on the thorny issue of water rights. The Government has kicked it to touch, saying it has listened to the concerns of the agriculture and horticulture sectors.

“The current allocation framework, including first-in, first-served permitting and secondary trading has been retained,” the Government said in a commentary on the changes.

Labour warns of too much Beehive control

Labour leader Chris Hipkins said he would not repeal the reforms if Labour formed a government after the election, however the party had serious misgivings about them.

Labour published a minority review on the select committee’s report, which was particularly critical of the regulatory relief measures included in the bill. Regulatory relief will require councils to compensate landowners when a regulation they make negatively affects their property.

A MartinJenkins report estimated the cost of this relief would be anywhere between $7 million and $1.99 billion. That cost would land predominantly on ratepayers.

The Government, in particular the Act Party, is keen on regulatory relief because they believe it will act as a disincentive against over-regulation.

Labour, in its minority report, warned the regulatory relief measures would “have a chilling effect on protections”.

“Councils told us that the regulatory relief requirement will be expensive and they are unlikely to be able to afford the cost of compensation, particularly in light of other Government work that will further restrict councils’ ability to raise funds,” the party’s report said, referencing the Government’s rate capping proposal.

Labour said that the new system’s “funnel” approach - which is designed to have the big policy debates at the top of the “funnel” in order to narrow the scope of what is up for debate at the bottom - effectively means more ministerial power.

Labour questioned whether this was appropriate - and noted that it concentrates a lot of power in the Beehive.

Green environment spokeswoman Lan Pham. Photo / Mark Mitchell

“Any deficiency in national direction, or even a change in Minister, could result in adverse flow-on effects throughout the entire system,” the party said.

The report noted that under the existing RMA, there was a hierarchy of goals, setting out which ones were more important than others. Under the new regime, this will change.

“By contrast, these bills specifically have no hierarchy in their purpose or goals. This means that when goals conflict with each other, the Minister will determine how the conflict is resolved – this is in effect the Minister establishing a hierarchy.

“This is a lot of power and leaves no wiggle room should a poor decision be made at the top of the funnel,” Labour’s report said.

The Parliamentary Commissioner for the Environment’s advice on the bill, which was included in the final report, was also critical of this, and said, “Parliament is effectively being asked to delegate environmental protection to the Executive on terms that are completely open-ended”.

‘Race to the bottom’ with $2b price tag – Greens

The Green Party said the bills ushered in a “race to the bottom” for environmental protection.

Green Party environment spokeswoman Lan Pham said “the Luxon Government is stripping away environmental protections while New Zealanders are left paying for the costs of environmental damage and the Government’s regulatory relief framework”.

Pham also cited the MartinJenkins report to say the regulatory relief measures could cost ratepayers $2b.

“The Government has not listened to local councils or submitters at all. Almost all submitters opposed the regulatory relief framework, which would force councils to pay private landowners not to destroy biodiversity.

“It has been estimated to cost ratepayers $2 billion, while the report writers themselves cautioned there is a high degree of uncertainty around those estimates.”